Holiday accumulation – (no) news under the sun
Holiday accumulation is the next step for employees to plan their career and work – life balance. Since these provisions of the law on agile and workable work came into effect on 1 February 2018, this article briefly explains what the system of holiday accumulation means, how it is introduced, what needs to be done in the event of a possible termination of the employment agreement and a short introduction to an already existing alternative.
What exactly does the system of holiday accumulation mean?
Holiday accumulation is a system that allows the employee to save certain time during his career so that this saved time can be used at a certain moment, for example to renovate a house. The difference with the current system is that the time does not have to be taken up immediately, but can be saved up over a longer period, depending on the rules stipulated in a collective labour agreement.
The time that can be saved is limited to:
- Voluntary overtime;
- Conventional vacation days, laid down in a collective labour agreement, where the employee can freely choose when these days are taken up;
- Hours that are performed in excess of the average weekly working hours with sliding working time schedules; and
- The overtime that is performed in the event of unforeseen necessity or extraordinary increase of the work.
Employees cannot be forced to step into such accumulation system. Employers can also not be obliged to introduce such system in their company if no agreement is reached at the level of the joint committee, but more about this under point 2.
In the future, a system could be established by Royal Decree whereby bonuses (for example the end-of-year premium) can also be accumulated and converted into vacation days.
How will the system be introduced?
Now that negotiations at the national level have not led to an agreement, it is up to the joint committees to reach agreements at sectoral level. The joint committees will only begin to negotiate after a request from one of the social partners. If no agreement is reached at this level within 6 months, it will be up to the companies themselves to reach an agreement by collective labour agreement.
The sector or company collective labour agreement must contain provisions on the following matters:
- How much time can be saved;
- Within what period you can save time; and
- The way in which the saved time can be used.
In addition, the following elements must also be included in the collective labour agreement:
- Rules on the valuation of the saved time;
- Management method and guarantees for the employee (the time saved can be managed by the employer himself, provided that the necessary payment guarantees are made, by an external institution or by the sectoral social security fund); and
- The treatment of the saved time in the event of liquidation of the company.
At sectoral level, it can be decided that the saved time is transferred with the employee in the event of a transfer to another employer within the same sector.
What happens when the employee leaves the company?
When the employee leaves the company, in any way whatsoever, the employee is entitled to the payment of the accumulated time. This also applies if the employee finds another job within the same sector and the possibility of transferring the saved time, would be foreseen.
Flex-plan as an alternative
The advantages for the employee can also give concerns to the employer. The following, amongst others, has to be taken into account:
- During which period can time be saved? What are the consequences if time can be saved for ten years or more?
- How will the saved time be valuated? Will it be valuated at the time it is saved or at the time it is taken up by the employee?
The introduction of a flex-plan allows to set down rules on the above mentioned questions and many more. This plan can be introduced on the company level and allows the employer more freedom to set up guidelines which tailor-fit his company.
The system of holiday accumulation has its ups and downs. It allows the employee to save time during a longer period and has important consequences for the ability of employees to plan their work-life balance. We are very closely following the negotiations in the different joint committees. We are of course available to assist you to insert such plan into your company.
KrisDe SchutterPartner Attorney at Law
Kris De Schutter is a partner in our office in Brussels and member of Loyens & Loeff’s Employment & Benefits Practice Group. He has extensive experience in alternative (flexible) remuneration, restructuring and change processes.T: +32 2 700 10 13 E: firstname.lastname@example.org